Noonan rules out any action by Europe on Ireland’s corporate tax rate

Minister for Finance Michael Noonan has ruled out any action by Europe on Ireland's corporate tax rate.

Speaking in Limerick earlier Mr Noonan was responding to suggestions by German finance politicians who are due to argue in Dublin today that Ireland can expect no further debt relief from its EU partners unless it shows readiness to reform its corporate tax system.

Minister Noonan admitted it may the view of individual members but said:

“That link has never been made to me and I am a few years going out to Europe,” Minister Noonan said.

“Tax matters are matters for sovereign governments. Everybody knows theres a new OECD study into corporate taxes right across the world with the G20 countries backing it and we are cooperating fully with that . But nobody in Europe has ever made the link between Ireland’s corporate tax rates and any action that might be taken by the Commission in other areas in respect of Ireland, so quite frankly I don’t believe it. “

Minister Noonan said he would be meeting with members of the Bundestag finance committee who are visiting until Wednesday.

“It may be view of individual members but I am actually meeting that delegation this week when they come to Dublin. They are members of the German parliament and they are on an officialy parlianmentary visit to Dublin so I will discuss matters full with them,” he added.

Members of the Bundestag finance committee, have suggested that naming the investors who benefited from EU-IMF bailouts in Ireland and elsewhere would boost the chances of further European debt relief.

"Right now, nobody is talking about legacy debt in Germany and I would expect that the idea of sharing part of the Irish debt burden is not popular with German taxpayers," said Dr Gerhard Schick, a senior deputy with the opposition Green Party and deputy head of the Bundestag committee.

“We need greater transparency,” said Dr Schick, who is leading the delegation to Dublin.

“Naming the creditors who were assisted [with the EU-IMF bailout] would assist the discussion in Europe for further debt relief.”

During their two-day visit, the committee will hold talks with Government officials and TDs about the recent EU-IMF bailout, with the Irish side expected to air outstanding financial expectations.

Berlin has rebuffed Irish calls for further financial concessions, such as investment from the ESM bailout fund to replace state investment in nationalised banks, until they are satisfied by the operation of the so-called banking union, with powers to regulate and wind up European banks.

In addition to political meetings, the German visitors will hold talks with economists, officials from Nama and the financial regulator.

Dr Schick said his committee had many questions about post-crisis reforms of the regulator and the rise of the so- called shadow banking sector. Some estimates say this sector of brass-plate and letter-box banks is worth €1.7 trillion - more than 10 times the worth of all products and services the State produces in a year, ie the gross national product.

“It’s unsettling the ideputyression one gets from press reports that everything is continuing as before in Ireland, but in the shadow banking sector rather than the banking sector,” said Dr Schick.

Irish officials are likely to face close questioning from the visiting German deputies on tax arrangements for Apple, after Ireland was one of three countries targeted by the European Commission in a tax investigation launched last week.